2. 273
KOREA
June Junghye Yeum1
and Wonyoung Yu2
A. LEGISLATION, TRENDS AND TENDENCIES
A.1 The Korea Arbitration Act
Both international and domestic arbitrations in Korea are
governed by the Korea Arbitration Act (the “Arbitration Act”).
The Arbitration Act is largely based on the UNCITRAL Model
Law (as adopted in 1985, excluding the 2006 amendments). The
ability of Korean courts to intervene in the arbitral process is
limited to circumstances specified in the Arbitration Act.3
Parties
can request that a court grant interim measures of protection
before or during the arbitration.4
The Arbitration Act mandates that Korean courts provide
assistance in the taking of evidence on written request from an
arbitral tribunal.5
Korean courts are also authorized to intervene
to assist arbitration proceedings in the following circumstances:
• To appoint arbitrators on request of either party in
circumstances where the parties, a designated appointing
1
June Junghye Yeum is a Partner and co-head of the International Dispute
Resolution Practice at Lee & Ko in Seoul, Korea. Prior to joining Lee & Ko, she
was a Partner at Baker & McKenzie’s New York office and has extensive
experience handling cross-border disputes and international arbitrations under
various arbitral rules including ICC and ICDR. She is also an arbitrator/neutral on
the panel of the KCAB, SIAC and WIPO.
2
Wonyoung Yu is an Associate of Lee & Ko’s International Dispute Resolution
Practice Group.
3
Article 6 of the Arbitration Act.
4
Id. at Article 10.
5
Id. at Article 28(3)-(4).

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authority, or the party-appointed arbitrators, as applicable,
have failed to do so.6
• To decide challenges to arbitrators on appeal from the tribunal.7
• To decide requests for termination of an arbitrator’s mandate.8
• To review the jurisdiction of an arbitral tribunal on request of
the objecting party in circumstances where the tribunal has
preliminarily ruled that it has jurisdiction.9
• To decide challenges to experts appointed by the arbitral
tribunal.10
Under the Arbitration Act, Korean courts can decide applications
for setting aside an arbitral award issued in Korea11
and
applications for recognition or enforcement of domestic or
foreign arbitral awards.12
Pursuant to Article 39 of the
Arbitration Act, Korean courts review applications for
recognition and enforcement of foreign arbitral awards to which
the New York Convention applies in accordance with the
Convention. While Articles 36 and 38 set forth the procedures
for setting aside an arbitral award, these provisions apply only to
domestic and not to foreign arbitral awards. A losing party
wishing to challenge a foreign arbitral award should therefore
wait for the winning party to bring an enforcement action in
Korea. If a vigorous defense is mounted, an enforcement action
in Korea may become a full-fledged litigation where both parties
6
Id. at Article 12(3)-(5).
7
Id. at Article 14.
8
Id. at Article 15.
9
Id. at Article 17.
10
Id. at Article 27(3).
11
Id. at Article 36.
12
Id. at Article 37.

4. A. Legislation, Trends and Tendencies
275
have the opportunity to present their case before the court.
However, as discussed below, courts generally will not engage in
a substantive review of the arbitral award. In practice, even a
hotly-contested enforcement action typically lasts for only about
six months to a year in the first instance court.
While the Arbitration Act primarily applies to arbitrations seated
in Korea, Article 2 of the Arbitration Act provides that Articles
9, 10, 37 and 39 shall apply irrespective of the place of
arbitration. Article 9 provides for the dismissal of a court action
where there is a valid arbitration agreement. Article 10 provides
that a party to an arbitration may request interim measures from
a Korean court. Articles 37 and 39 set forth, respectively, the
procedural requirements for obtaining recognition and
enforcement of a foreign arbitral award, and the standards for
determining whether a foreign arbitral award will be enforced in
Korea. Pursuant to Article 37, a party applying to a Korean court
for recognition or enforcement must submit authenticated
originals or certified copies of the arbitral award and arbitration
agreement. This is the only procedural requirement for recognition
and enforcement of a foreign arbitral award in Korea.
Presently, a task force set up by the Korean Ministry of Justice is
reviewing the Arbitration Act with a view to introducing
amendments to the Act in light of the 2006 amendments to the
UNCITRAL Model Law. A draft bill amending the Arbitration
Act is expected to be submitted to the Korean National
Assembly sometime in 2013.
A.2 The Korean Commercial Arbitration Board
The Korean Commercial Arbitration Board (the “KCAB”) is the
only arbitral institution in Korea specifically authorized under
the Arbitration Act to administer commercial arbitrations. Since
its inception in 1970, the KCAB has administered over 4,000

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domestic and international arbitrations and is known to be an
efficient and responsive arbitral institution. Its International
Arbitration Rules ("International Rules") were first introduced in
2007 in an effort to better serve an increasing number of
international arbitration cases filed with the KCAB. As
originally promulgated the International Rules were not
automatically applicable to all international arbitration cases, but
only to those in which the parties had agreed in writing to refer
their disputes to the International Rules.
As a consequence of this opt-in requirement, the International
Rules saw very little use during the first four years of their
existence. However, under amendments effective as of
September 1, 2011, with respect to arbitration agreements
entered into after that date, the International Rules apply by
default to all KCAB arbitrations in which any party is from a
jurisdiction outside Korea or where the place of arbitration is
outside Korea.13
The International Rules are similar to those of
major international arbitral rules such as the ICC and SIAC rules
and are designed to reflect the latest standards and best practice
in international arbitration.
As of January 2013, a total of 1,224 arbitrators are listed on the
KCAB’s Panel of Arbitrators, including over 200 arbitrators on
its Panel of International Arbitrators. The KCAB, unless
otherwise agreed by the parties, appoints arbitrators from a list of
candidates recommended by KCAB's Secretariat. The KCAB
and its Secretariat employ many internationally trained,
knowledgeable arbitration practitioners and case managers, who
generally provide efficient, high-quality service of international
caliber in a transparent manner. Further, the KCAB offers a
wealth of training and education programs on international
13
Articles 2(d) and 3(1) of the International Rules.

6. A. Legislation, Trends and Tendencies
277
arbitration, contributing to Korean companies’ increasing
knowledge and use of arbitration.
A.3 Latest Developments in Korean Arbitration
Seoul International Dispute Resolution Center
As Korean companies continue to gain leverage in the global
market, we are also seeing more arbitrations seated in Korea and
an increase in the number of international arbitrations involving
Korean companies. There is a consistently growing momentum
to enhance the already-strong level of support in Korea for
international arbitration to expand its adoption of best
international practice and to attain the status enjoyed by SIAC
and HKIAC as a competitive Asian arbitration center. Acting
upon such a momentum, the Korean Bar Association and Korean
legal community have worked together to set up a state-of-the-art
arbitration infrastructure (tentatively named “Seoul International
Dispute Resolution Center”), which has recently signed
memoranda of understanding with major arbitral institutions
such as HKIAC and LCIA.
Korea’s First Major Investor-State Arbitration Case
The level of investor-state arbitration in Korea has generally
been negligible. Until recently, only one reported case was filed
with ICSID, which was settled before proceeding to an award.14
In November 2012, in a much-publicized matter, the holding
company of US private equity firm Lone Star, LSF-KEB, filed
an ICSID claim for purported unlawful interference of its rights
as majority shareholder in the Korean Exchange Bank.15
Having
14
Colt Industries Corporation v. Republic of Korea, ICSID Case No. ARB/84/2.
15
LSF-KEB Holdings SCA et al v. Republic of Korea, ICSID Case No. ARB/12/37.

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entered into over ninety BITs16
and several FTAs, most of which
include arbitration as a means of resolving disputes between
foreign investors and states, Korea is expected to witness an
increasing number of investor-state disputes going forward.
B. CASES
B.1 Reliance on Public Policy for Resisting Enforcement
Application of “International Public Policy” to Foreign Arbitral
Awards
The arbitral process in Korea is supported by pro-enforcement
courts which seldom refuse to recognize or enforce a foreign
arbitral award under the New York Convention. Of the grounds
for refusing recognition and enforcement of a foreign arbitral
award, one that is most frequently relied upon by the resisting
party has been the public policy exception under Article V(2)(b)
of the New York Convention. Korean courts routinely have held
that the Article V(2)(b) public policy exception should be
restrictively interpreted in light of the need for certainty and
stability in international commercial transactions.17
Under this
principle, Korean courts have rejected parties’ attempts to resist
enforcement in Korea on public policy grounds based upon
allegations that enforcing the award would be inconsistent with
Korean law.18
The Seoul High Court has held that the same
16
United Nations Conference on Trade and Development, “Investment Instruments
Online: Bilateral Investment Treaties,” viewed on January 15, 2013,
http://www.unctadxi.org/templates/DocSearch.aspx?id=779.
17
See Seoul High Court Judgment 2000Na23725, 27 February 2001; Seoul High
Court Judgment 2003Na5513, 5 December 2003; Seoul Central District Judgment
2011 GaHap29968, 1 June 2011.
18
See Supreme Court Judgment 89DaKa20252, 10 April 1990; Seoul Central
District Court Judgment 2009GaHap136849, 9 July 2010.

8. B. Cases
279
standard applies even where Korean law is the governing law of
the arbitration.19
Awards in Violation of Mandatory Provisions of Korean Law
In a 2010 New York Convention case, the Seoul Central District
Court indicated that certain mandatory provisions of corporate
law are not arbitrable and thus any award determining such
matters would be unenforceable as contrary to public policy.20
The district court, however, went on to find that the award was
not in violation of mandatory provisions of Korean corporate law
at issue in the case, and enforcement of the award could not,
therefore, be considered inconsistent with international public
policy. While not entirely clear, the court’s ruling seemed to imply
that had the court found the award in breach of any of those
mandatory provisions, it would have refused to enforce the award.
Seoul Central District Court Judgment, 2011KaHap82815, 27
September 2012
In a recent decision issued on September 27, 2012, the Seoul
Central District Court did find a foreign arbitral award
unenforceable on the ground that the underlying transactions and
the plaintiff’s activities violated, inter alia, certain mandatory
provisions of the Asset-Backed Securitization Act of Korea and,
as such, were deemed inconsistent with good morals and the
social order of Korea. Interestingly, while the proceeding was a
New York Convention case, the district court did not refer to the
concept of “international public policy.” This case is currently on
appeal and if the ruling is sustained, it will mark the second
Korean case refusing the recognition and enforcement of a
foreign award.
19
See Seoul High Court Judgment 2003Na5513, 5 December 2003.
20
See Seoul Central District Court Judgment 2009GaHap136849, 9 July 2010.

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B.2 Reliance on Fraud for Refusing Enforcement of a Foreign
Arbitral Award
Supreme Court Judgment 2010Da3148, 29 April 201021
The Supreme Court of Korea has held that obtaining an arbitral
award by fraud could constitute grounds for refusing recognition
and enforcement under the public policy ground of the New
York Convention only when the following elements are met:
(i) there is clear evidence that a party seeking enforcement of an
arbitral award committed fraud in the arbitral proceedings;
(ii) the counter-party did not know of the fraud and did not have
an opportunity to raise the issue of fraud during the arbitral
proceedings; and (iii) there is a causal connection between the
fraud and the outcome of the arbitral proceedings. The Supreme
Court determined that the first two elements were not satisfied in
that case and reaffirmed the limitations to the ability of the courts
to review the merits of arbitral awards under the New York
Convention.
C. THE GRANT AND ENFORCEMENT OF INTERIM
MEASURES IN INTERNATIONAL ARBITRATION
C.1 Tribunal-Ordered Interim Measures
Under the Arbitration Act, unless otherwise agreed by the
parties, the tribunal can, at the request of a party, issue a decision
granting the interim measures that it considers necessary in
respect of the subject matter of the dispute.22
These interim
21
Related cases are Ulsan District Court 98GaHap8505, 31 July 2003; Busan High
Court Judgment 2003Na12311, 16 February 2006; Supreme Court Judgment
2006Da20290, 28 May 2009 and Busan High Court Judgment 2009Na7618, 25
November 2009.
22
Article 18 of Arbitration Act.

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281
measures include preliminary injunctions, provisional attachments
and orders seeking preservation of evidence or security for costs.
It is generally understood that a tribunal is not entitled to issue
injunctive relief with respect to assets of a party that are not the
subject matter of the dispute, e.g., by providing a means of
preserving assets with which a future favorable award may be
satisfied.
Article 18 of the Arbitration Act authorizes the tribunal to grant
interim measures in the form of an order or decision, but not in
the form of an award. It is generally accepted that a tribunal may
grant interim measures of a nature similar to those issued by a
Korean court, subject to certain limitations. For example, a
tribunal cannot issue preliminary measures with respect to a third
party that is not a party to the arbitration.
There are no statutorily defined tests that an applicant must
satisfy in order for the tribunal to order interim measures. Korean
courts, however, apply the following test: (i) the applicant must
have a viable claim that will likely succeed on the merits; and
(ii) unless the interim measure is granted, execution of the
judgment will be difficult, if not impossible in light of the
likelihood that the losing party will dissipate its assets.23
The
2006 amendments to the UNCITRAL Model Law concerning
interim measures and preliminary orders are being considered for
potential adoption in 2013.
C.2 Court-Ordered Interim Measures
Under Article 10 of the Arbitration Act, interim measures of
protection may be requested from a court before or during
arbitral proceedings (where the arbitration has commenced, a
court may grant interim measures irrespective of whether the
23
See Articles 276, 278 and 303 of the Civil Enforcement Act.

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tribunal has been constituted). Further, under Article 276 of the
Civil Enforcement Act, interim measures of protection may also
be granted after an award has been rendered and pending its
recognition and enforcement. Any court-ordered provisional
relief obtained before the constitution of an arbitral tribunal
maintains its force even after the tribunal is constituted.
Normally, a Korean court will not issue an injunction against a
party to restrain ongoing litigation in a foreign court. Although
courts can issue interim measures with respect to assets of third
parties to the arbitration, the assets (or subject matter of the
provisional attachment) must be located in territory over which
the relevant court has jurisdiction, or else the parties must have
agreed to confer jurisdiction on the relevant court to issue such
relief. Korean courts will likely grant interim measures if the
subject matter or assets are located in Korea, even where the
place of arbitration is outside Korea. Where neither the subject
matter/assets nor the seat of arbitration is in Korea, Korean
courts will likely reject the application unless there is a ground
for exercising jurisdiction in the case.24
C.3 Enforcement of Interim Measures
Interim orders by the tribunal are not enforceable by the court in
the same way as an award and/or court judgment. Interim
measures issued by tribunals are generally understood to lack
enforceability by Korean courts. However, the issuance of such
interim measures often serves as persuasive evidence supporting
the grant of an injunction or attachment application filed with the
court pursuant to Article 10 of the Arbitration Act.
24
See Articles 278 and 303 of the Civil Enforcement Act